1. How much cash is to be distributed to the partners?2. How much is to be distributed to the partners if they share profits at a ratio of 3:6:1 respectively? The statement of financial position of the firm of Wanda, Wendy and Wilma justbefore liquidation shows the following:AssetsP240,000LiabilitiesP100,000Wanda, LoanWanda, CapitalWendy, CapitalWilma, Capital20,00044,00060,00016,000P240,000TotalWanda, Wendy and Wilma share profits 5: 3: 2 respectively. Certain assetsworth P160,000 are sold at book value. Creditors are paid in full, partners arepaid P40,000 and cash of P20,000 is withheld pending future developments.

Distribution to Partners for the cash balance remaining after payment of all outside liabilities and…

Answered: How much cash is to be distributed to…

How much cash is to be distributed to the partners? 2. How much is to be distributed to the partners if they share profits at a ratio of 3:6:1 respectively?

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter20: Corporations: Distributions In Complete Liquidation And An Overview Of Reorganizations

Section: Chapter Questions

Problem 1BCRQ

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Concept explainers

Partnership Accounting

A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.

Partner Admission and Withdrawal

A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.

Question

100%

1. How much cash is to be distributed to the partners? 2. How much is to be distributed to the partners if they share profits at a ratio of 3:6:1 respectively?

The statement of financial position of the firm of Wanda, Wendy and Wilma just
before liquidation shows the following:
Assets
P240,000
Liabilities
P100,000
Wanda, Loan
Wanda, Capital
Wendy, Capital
Wilma, Capital
20,000
44,000
60,000
16,000
P240,000
Total
Wanda, Wendy and Wilma share profits 5: 3: 2 respectively. Certain assets
worth P160,000 are sold at book value. Creditors are paid in full, partners are
paid P40,000 and cash of P20,000 is withheld pending future developments.

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